Abstract

To bring visibility of complicated arrangements used by planners to ensure the tax efficiencies of transactions, the tax legislation has introduced a mechanism to report certain transactions to SARS, failing which the parties can be heavily penalised. Until a recent amendment dated 3 February 2016, (vol. 608, Government Gazette no. 39650) ("the Public Notice"), the rules relating to reportable arrangements excluded the need for a municipality to report (i.e. no tax benefits enjoyed by a tax exempt entity). Now, in main, the Metropolitan councils (Category A) or larger municipalities will be required to consider the application of "reportable arrangements" set out in sections 34 to 39 and section 212 of the Tax Administration Act, 2011 ("TA Act").